Doing Business - The Series

As Graz said in his presentation at the 2003 PASS Summit, "I'm a consultant.  Therefore I have an opinion on that."  I have a lot of opinions on how business should be done.  This is one big reason why I'm an independent contractor instead of an employee...sooner or later I have a conflict with how the company does business when I'm employed there.  And since I studied business at the University of Washington, some of my opinions are even educated.  So, I thought I'd start a series of posts on "doing business" as an adjunct to the SQL stuff.  Some of this will be focused toward other ICs, some of it will be applicable across the board.  And if you want to know more about my background, and why my opinion may or may not have validity, you can check it out here.

To get started, I thought I'd respond to a common lament:  Clarke Scott asks Why Does the Corproate World Do What it Does?

A common mistake that managers make, is to forget that money already spent is what is known in managerial accounting terms as a "sunk cost" and should not be factored into future decisions.  Unfortunately, they're usually coming from the position of, "I have to justify that 'investment' by getting some return from it, even if that is not really the best path to take from this point forward given the new information we now have".  If you're trying to convince them that a different path would be better, it really does take some sales skills to gently open their minds to the idea that it's better to scrap a bad plan, cutting your losses, and move on with a better one.  But the key to this type of argument is explaining in managerial terms WHY your new plan is better.  HINT:  "Because it's new/cool" is not a good reason.  "Because it will save the company $10,000 per month" IS a good reason.

Too many computer geeks are too caught up in the latest-greatest-gotta-have-it craze and have no clue what it takes to actually run a business, make money, meet payroll, cover taxes, pay for rent + equipment + software + + +...did I mention taxes?  And then they don't understand why management isn't excited about their "great ideas".  Companies are in business to make money, not just create cool stuff.  That is why so many dot-coms failed.  They had a cool idea, but not a cool business.  Most of them never should have seen the light of day as a business, but everyone was in such a panic trying to find the next Microsoft (stock to make them millionaires) that they threw money at anything that sounded possible.  But that's a rant for a different day.

posted @ Thursday, November 20, 2003 5:38 PM

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# re: Doing Business - The Series

Left by mohdowais at 11/23/2003 10:04 PM
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Aaahh...good to see another business grad in the IT business, just when I was beginning to feel I was all alone!! You were absolutely spot-on about how most geeks don't even realize what it takes to run a business. The let-the-customer-suffer attitude has cost IT companies time and again, but nobody has ever thought of educating the programmers on why businesses exist in the first place. Most developers I know have an absolutely terrible attitude towards customer satisfaction...please people, this is where the paychecks come from!

# Top 15 Business Mistakes Consultants Make

Left by Ajarn's SQL Corner at 8/19/2004 11:25 PM
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There is another set of common business mistakes that are much more practical, some are even stunning that anyone would commit.

# Top 15 Business Mistakes Consultants Make

Left by Ajarn's SQL Corner at 1/24/2005 12:21 PM
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There is another set of common business mistakes that are much more practical, some are even stunning that anyone would commit.
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